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Just 10 funds accounted for more than half of the $105.72 billion gathered by 164 funds in the second quarter. And according to PEI data, several limited partners made hefty commitments to more than one of them.
Chief among them is the $180 billion New York State Common Retirement Fund, which committed more than $1 billion to four of the funds: Ares Corporate Opportunities Fund V, The Sixth Cinven Fund, Brookfield Capital Partners IV, and Hony Capital Fund VIII.
The Teacher Retirement System of Texas, rated second best performing US pension plan by the American Investment Council with a 10-year annualised return of 17.8 percent, also backed Cinven and Hony Capital, investing $342 million and $150 million. It also committed $300 million to Leonard Green’s Green Equity Investors VII, which, at more than 50 percent larger than its predecessor, blasted through its hard-cap to close on $9.6 billion in June.
West-coast giants California Public Employees’ Retirement System (CalPERS) and California State Teachers’ Retirement System (CalSTRS), with combined assets under management of close to $500 billion, each made three commitments to the 10 largest vehicles. The pension funds committed $350 million and $150 million respectively to Welsh Carson Anderson & Stowe XII, which exceeded its $3 billion target to close on $3.33 billion in June. They also both committed to Hony’s latest fund.
CalPERS took a significant chunk of the $7.85 billion Ares Corporate Opportunities Fund V, committing $425 million, while CalSTRS opted to commit $250 million to this year’s largest fund to date, the $14 billion Ardian Secondary Fund VII. That fund, which closed in April, comprises a $10.8 billion pool for secondary investments and a $3.2 billion pool for primary investments.
Ardian also garnered commitments from Ohio Public Employees’ Retirement System, La Caisse de Dépôt et Placement du Québec (CDPQ) and Pennsylvania State Employees’ Retirement System. Tennessee Consolidated Retirement System, which committed $75 million to Ardian, earmarked $200 million for Cinven, while Florida State Board of Administration, which committed $150 million to Ardian, made a $200 million commitment to Ares Corporate Opportunities Fund V.
Ares Management was responsible for two of the 10 largest funds, raising a combined $10.63 billion for its global vehicle and its Europe fund. The public pension funds that committed to the global fund – which, as well as the above, include New Mexico State Investment Council, Kansas Public Employees Retirement System and Nebraska Investment Council – did not make commitments to the European fund.
Among the $2.78 billion Ares Capital Europe III investors are Mercer Private Markets, Golding Capital Partners and Pictet Alternative Advisors.
The $2.56 billion Kelso Investment Associates IX, the ninth-largest fund to close in Q2, drew a $100 million commitment from the Michigan Department of Treasury and a $45 million commitment from Employees' Retirement System of the State of Hawaii, both of which are investors in Leonard Green’s fund.
The fund also counts Alaska Permanent Fund, Teachers’ Retirement System of Louisiana and Maine Public Employees Retirement System among its investor base.
Meanwhile Minnesota State Board of Investment, the third best performing US pension plan with a 10-year annualised return of 16.2 percent according to the AIC, committed $150 million to Welsh Carson’s fund and $100 million to Brookfield’s vehicle, which, at $4 billion, it four times larger than Fund III, which closed on $1 billion in September 2011.
There is, as ever, just one investor on the roster for captive investor ATP PEP V – ATP, Denmark’s largest pension fund. In June the ATP allocated a further €700 million to the fund, doubling its size to $1.67 billion and signalling a strong commitment to the asset class.
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